Thursday, October 26, 2023

Whose land is it anyway? Why South Australian farmland has no protection against mining.

As it currently stands within the 1971 Mining Act of South Australia, farmers have no right to veto mining activities over their land. When extractive minerals are found, or believed to be located, on farmland, the land owners are required to hand their land over to the government, where it is sold on to mining corporations. Why? Because section 16 of the Mining Act specifies that all minerals rights are held by the Crown (the governing authority of Australian law at both a State and Federal level). 

All decision making power with relation to mineral lies with the Minister for Energy and Mining, meaning they have the ability to grant mining related licences over private land without needing to seek permission from the land owner. This inequitable balance powered by statute has, and will, continue to inflict harm upon the farming industry throughout South Australia. 

A lack of power to prevent corporate destruction to farmland is the sort of nightmare fuel that breeds a lack of trust between the government and its people. I guess the most appropriate question to ask in this situation is, if you can't say no to someone ripping up your land, then is it really your land at all?

I have very few bad things to say about South Australia. It has been my home for almost all of my 24 years of life. It is host to incredible wine regions, farm and river land, outback spectacles and the second biggest annual arts festival in the world. However, when it comes to the South Australian government and its undying love for mining, there is no possibility of coming in between them, regardless of what harm may ensue. This is something that makes my blood boil to a level I simply cannot put into words. 

To try and give you an idea of how highly valued mining is within South Australia, in the March quarter of 2023 alone, the government spent AUD$64.2 million on mineral exploration (scouting and searching areas for extractive minerals). This broke an 11-year long Australian record of $61 million, which was also set by South Australia in the December quarter of 2012. 

While $64.2 million sounds like an obscene amount of government money to spend on just the exploration purpose, South Australia is a treasure trove of undiscovered minerals and highly valued finite resources. Evidence for the presence of such resources is Olympic Dam: one of the most significant mineral deposits in the world.

Olympic Dam (owned and operated by BHP) is located around 350 miles from the state's capital, Adelaide, it has roughly 435 miles of underground roads that run throughout the mine and is estimated to be worth anywhere between AUD$4.9 - $5.4 billion according to the Australian Financial Review. Olympic Dam is such a significant site that the town of Roxby Downs was purposefully established and built to support the mine. 

At its most successful, the South Australian mining industry generated AUD$7.3 billion in a single financial year, meaning it holds an undeniably significant value to South Australia's economy. With revenue like this, it is easy to understand why the government would hold such a destructive industry close to its heart.

It's hard to imagine that another single industry could provide a more influential value to a State than mining does. After all, mining's where the money is, right? To a certain extent yes, but South Australian farmers would argue otherwise.

In the 2021/22 financial year, South Australia's agribusiness and primary industries^ generated $10 billion MORE than the mining industry did at its peak. Coming in at a whopping AUD$17.3 billion in revenue, South Australia's agricultural industry increased its revenue by almost $2 billion in a single year (after the previous all time high of $15.4 billion in the 2020/21 financial year). Within this enormous figure, field crops came in as the biggest contributor with $5.6 billion, followed by livestock with $4.1 billion and wine with $2.4 billion. 

An absolute necessity for the agricultural industry is arable farmland. Healthy top-layer soil and everything below is the key to successful crop growth. Crop growth is not just used for harvesting food, but also animal feeding, grazing land and vineyards. Without healthy soil, there is no possibility for the land to be used for agricultural purposes. 

When privately owned farmland is purchased by mining corporations, there is a statutory requirement that mining corporations are required to have an approved Program for Environmental Protection and Rehabilitation ('PEPR') prior to the commencement of any extractive project. These programs are designed to promote a greater level of environmental responsibility, by requiring corporations to restore land after an extraction project has completed. 

While there are legislative mechanisms for enforcement of these programs, the penalties in place for non-compliance are shockingly insignificant compared to the revenue mining corporations generate. Failure to comply with a PEPR will result in a maximum civil penalty of AUD$250,000. Using Olympic Dam as an example (but note they are governed by their own statute), it would take BHP just under 2.5 minutes to generate the $250,000 needed to cover the penalty (calculations below). 

So why does the government impose such pathetic penalties? Why does the government place a higher value on land use for mining over agriculture? It's simple: the government is entitled to royalties from all extracted minerals due to Crown ownership. 

In the 2019/20 financial year, the South Australian government received AUD$311 million in mining royalties. While I understand the government needs all the financial support they can receive, this also showcases an absolute inability for sustainable, long term economic consideration. Profits now, will lead to detriment for the future of South Australia's economy if farmland continues to be surrendered for mining practices.

In my humble opinion, Western Australia is operating decades ahead of everyone else. Section 29 of the Western Australian Mining Act affords land owners the power to veto any form of mining activity proposed to affect the surface of their land. This statutory protection not only protects Western Australia's agricultural industry and economy, it also protects the wellbeing of its farmers. This is a legislative provision that while being small, hands over significant power to farmers and more importantly, demonstrates to them that their government cares. 

So where should South Australia go from here? Allowing farmers the power to veto mining activity over their land is the bare minimum that can be enforced to protect South Australia's agricultural industry. Once farmland has been contaminated by mining practices, it is near impossible to recover the land to its original condition. The practice of mining transforms farmland into a finite resource - once it has been used for mining, it will never be useable for agricultural purposes again. 

These farmers need a safeguard. They need their government to listen to them and support them. The South Australian government needs to walk away from their money hungry attitudes and begin to look after the agricultural powerhouse they are privileged to have at their finger tips. 

What I would say to the government if they could hear me - shame on you and your ignorance. Your lack of awareness on the destructive nature of mining is simply embarrassing. Farming matters. The sooner you wake up and realise this, the better off our State will be. 

If you wish to read more about the importance of Australia's agricultural industry, I explored live animal exports in Western Australia, in previously published posts available here and here


^'Primary industries' is the collective term used for South Australia's field crops & grains, livestock, wine, horticulture, forestry, dairy, seafood, wool and animal feed industries. 



For the 2021/22 financial year, BHP reported earnings of AUD$57 billion.  

The mine operates 24 hours a day, 365 days of the year.

This generates approximately $156 million per day, $6.5 million per hour and $108,00 per minute.

108,000 x 2.5 = 270,00 

Therefore, just under 2.5 minutes to earn enough to cover a $250,000 penalty. 


Laretta Johnson said...

Sophie, thank you for such a fascinating expose on South Australian mining. There are a lot of issues in the U.S. pertaining to mining as well - specifically with corporations mining on sacred homelands and near reservations of Native people - but I had never heard of a system wherein the government outright owns all mineral rights. I sincerely hope South Australia will shift its system and choose to protect the land.

Thalia Taylor said...

It's super interesting that the Crown retains the mineral rights. Even though the government doesn't protect the land from contamination, they potentially could. In the US, a lot of environmental regulation (particularly for pollutant contamination) has exceptions for "innocent" landowners. Though the incentives at the moment fall in favor of the mining companies, I feel like the right legislation could make the cards fall very differently. National ownership of mining rights could mean that the government could condition leases on progressive environmental and labor standards in a way that they couldn't if the land were privately owned.